Dáil Éireann díospóireacht -
Thursday, 17 Oct 1991

Vol. 411 No. 2

Ceisteanna—Questions. Oral Answers. - Social Welfare Budget Allocation.

Paul Connaughton

Ceist:

2 Mr. Connaughton asked the Minister for Social Welfare if the allocation in the 1991 budget for social welfare is sufficient to provide unemployment benefit and assistance payments for the increased numbers of people who are unemployed; if it is his intention to bring a Supplementary Estimate before Dáil Éireann; if so, when; the approximate amount of such an Estimate; and if he will quantify the loss to the Exchequer in PRSI payments as a result of the increased numbers on the dole.

Dr. Woods

Based on present trends, the allocation in the 1991 budget will not be sufficient to cover the full cost of the services provided by my Department this year. Accordingly, I will be bringing a Supplementary Estimate before Dáil Éireann probably in late November. Work is in hand to establish the precise amount of additional funds which will be required.

This year's published Estimate of the yield from PRSI contributions is £1,373 million. This Estimate was based on the numbers expected to be in employment or self-employed during 1991. Current indications are that, in spite of the increased numbers on the live register, the numbers employed are holding up and the target of £1,373 million will be slightly exceeded.

Mr. Connaughton

Would the Minister agree that the Government were caught completely by surprise by the dramatic rise in the numbers on the unemployment register? If the Minister for Social Welfare is not in a position to give some indication as to how high that Supplementary Estimate will be, it shows that the strategic planning has not been done. I find it very remarkable——

An Ceann Comhairle

A question, please.

Mr. Connaughton

If there is such a huge increase in unemployment, how has the PRSI figure stayed the same? The people at work must have paid a lot more. The Estimates for Social Welfare are out of kilter by at least £60 million but the Minister does not want to mention a figure.

Dr. Woods

I have given the factual position. The September returns will be available shortly and they will give some indication but we will not get a full indication until some time later. The figure is likely to be in excess of £80 million in total. We will know more about that later. The level of income from PRSI is running above target at present and if it continues to do so, the demand will obviously be reduced. The Deputy asked how the PRSI figure can be the same. It is very simple. Employment has held up and the numbers expected to be in employment have continued to be in employment. The contributions expected from those people are holding up. A number of emigrants have returned home and in many instances have gone on the live register, along with people whom the Department of Finance had anticipated would go away but who did not do so.

They have mainly gone on to the register of unemployed.

Mr. Connaughton

How did the Government get it so wrong that they would be £80 million out in about six months? Can the Minister explain that?

Dr. Woods

It is not a question of six months.

Mr. Connaughton

It is six.

Dr. Woods

The Estimates were prepared last year and something happened at the beginning of this year which the Deputy likes to forget, that is, the Gulf War. The American economy went into recession, the British economy went into recession and since the Department of Finance, when preparing the Estimates last year, could not have known there would be a Gulf War at the beginning of this year, that factor would not have been taken into account at that time. It is a little childish, if the Deputy does not mind my saying so, to ignore these realities.

Mr. Connaughton

It was a phoney budget and the Minister knows it.